The BRRRR method (Buy, Rehab, Rent, Refinance, Repeat) is a proven strategy for investors looking to scale their real estate portfolios with maximum efficiency.
By recycling capital from one project into the next, investors can grow faster without continually injecting new funds. Still, the model hinges on one critical phase: the refinance.
When it comes to refinancing in your BRRRR strategy, DSCR loans are often the best path forward.
Debt Service Coverage Ratio (DSCR) loans offer a streamlined alternative to traditional refinancing. Rather than focusing on personal income or tax documents, DSCR lenders evaluate a property based on its ability to cover its own debt.
This approach fits seamlessly with the BRRRR method, allowing investors to maintain momentum, reinvest faster, and grow without income-related bottlenecks.
Start your application with Park Place FinanceBreaking down the BRRRR method
The BRRRR method is a repeatable investment model built for long-term growth.
- Buy: Investors purchase undervalued or distressed properties, often with cash or short-term hard money loans. These properties usually need renovations before they’re rent-ready.
- Rehab: Renovations improve the property’s value and marketability. Smart rehab work attracts tenants and supports a higher appraisal during refinancing.
- Rent: Once stabilized, the property is leased to tenants. This rental income turns a completed project into a performing asset.
- Refinance: The initial loan is replaced with long-term financing, often a cash-out refinance. The investor recoups their capital while locking in more favorable terms.
- Repeat: With funds recovered, the investor reinvests in a new property and starts the cycle again. While every phase is important, the refinance step keeps this cycle moving. It’s the bridge between completed work and the next opportunity.
What is a DSCR loan, and how does it work?
This type of investment property financing focuses on asset performance rather than personal income.
Lenders evaluate whether the property’s net income can cover its debt payments using a simple formula:
DSCR = Net Operating Income ÷ Total Debt Service
A DSCR of 1.0 means the income covers the loan payments exactly. Most lenders look for a safety ratio of at least 1.1 to 1.25.
Key features of DSCR loans include:
- Approval is based on rental income, not personal tax returns
- No employment or income verification
- Quick underwriting timelines
- Available for long-term rental properties
- Scalable across multiple properties
DSCR loans benefit full-time investors, those with complex finances, or anyone who’s reached the cap on conventional mortgage products.
Why DSCR loans are ideal for BRRRR investors
The BRRRR method only works if refinancing is consistent and predictable.
Traditional lenders often require W-2s, debt-to-income calculations, and multiple layers of documentation.
DSCR loans eliminate those steps by basing approval solely on the property’s cash flow.
How DSCR loans strengthen the BRRRR model:
- No income ceilings: Investors who reinvest heavily or reduce their taxable income through write-offs aren’t penalized.
- Portfolio-friendly: Investors can own multiple properties without triggering caps or added friction.
- Supports cash-out refinancing: A DSCR loan can return capital to fund the next deal once the property is rented and reappraised.
- Keeps the cycle moving: Refinancing is faster and smoother without complex documentation, helping investors reinvest with minimal delays.
DSCR financing removes the friction that can stall growth. When paired with a strong rental strategy, it allows investors to scale consistently.
Strategic tips for using DSCR loans in the BRRRR method
To get the most from your BRRRR strategy, it’s important to plan the financing from the start.
Here’s how to align each phase with DSCR-friendly lending:
1. Prioritize rental potential during rehab
Design improvements that raise rent value, not just aesthetics. Higher rents support better DSCR ratios.
2. Maintain clear records
Keep detailed receipts, leases, and operating budgets. This helps with appraisals and loan underwriting.
3. Know your lender’s seasoning period
Some lenders require three to six months of ownership or rental history before refinancing.
4. Work with a dual-solution lender
Choose a lender like Park Place Finance that can handle both the acquisition loan and the refinance.
5. Preserve your credit and reserves
While income isn’t verified, credit score and liquidity still influence the loan decision.
How BRRRR investors can position for faster DSCR approvals
DSCR loans are known for streamlined underwriting, but preparation still matters.
To avoid delays and improve loan terms, investors should:
- Establish clear rental comps early in the process
- Pre-screen tenants and lock in leases before refinancing
- Work with appraisers familiar with investment properties
- Maintain clean titles and LLC structure to avoid legal friction
These steps help streamline the refinance phase to meet lender expectations, reduce rework, and shorten the timeline between stabilization and closing.
That efficiency allows you to reallocate capital faster and stay on pace with your BRRRR goals.
DSCR refinance in a BRRRR deal example
Let’s look at an example:
You acquire a distressed duplex for $200,000 using a short-term hard money loan.
After completing $40,000 renovations, each unit rents for $1,500, generating $3,000 in monthly income. Once stabilized, the property appraises at $320,000.
You then refinance into a DSCR loan at 80% loan-to-value, receiving $256,000. That’s enough to pay off the original loan and recover some of your rehab costs.
Now, you own a cash-flowing property with minimal capital left in the deal, and you’re ready to roll those funds into your next BRRRR project.
When supported by the right financing, this cycle of acquisition, improvement, rent, refinance, and repeat becomes a scalable growth strategy.
Putting the BRRRR method to work with Park Place Finance
The BRRRR method is one of the most effective long-term real estate growth strategies. But its success depends on the ability to refinance with speed, flexibility, and scale.
DSCR loans align perfectly with that need. Focusing on property cash flow rather than personal income simplifies the refinance step and allows investors to continue the cycle without friction.
At Park Place Finance, we specialize in acquisition and DSCR refinance loans, helping investors confidently navigate every stage of the BRRRR process.
Apply with Park Place Finance today and keep your portfolio moving forward, one property at a time.